Issuing a stark warning about the risk of power shortages from 2018, Sri Lanka's energy regulator has called on utilities to immediately start construction works for a first series of approved power plant projects. Pressure to add much-needed capacity has been put in particular on Ceylon Electricity Board (CEB), Sri Lanka’s main energy supplier.
The Public Utilities Commission (PUCSL) requested from CEB to submit a concrete implementation plan for each power plant that is scheduled to start up in 2017-2020, according to the recently approved Least Cost Long Term Generation Expansion Plan 2015-2034.
All approved power plant projects should be “immediately constructed and operated, to prevent the possible power shortage in year 2018 and beyond,” the regulator stressed. “Failure to commission these power plants on time will cause countrywide power shortages as early as 2018/19,” warned PUCSL’s managing director Damitha Kumarasinghe.
Capacity additions, proposed by CEB, include two 170 MW thermal plants in the southern region, a 300 MW gas power plant and another a 105 MW open-cycle gas turbines plant as well as renewable energy projects with a combined capacity of 700 MW, including three major hydroelectric plants.
Confusion over coal vs LNG-fuelled plants
Foreign investors, notably from India, have been bewildered about a U-turn of the Sri Lanka’s President Maithripala Sirisena on the country’s energy policy. In mid-July, the president requested India to stop the planned 2×250 MW coal power plant in Sampur, Trincomalee, and turn it into running on LNG.
During his last visit to India, Mr Sirisena had requested Indian Prime Minister Narendra Modi not to proceed with the 500 MW coal power plant at Sampur but build a plant using LNG instead. His U-turn has puzzled some Indian project developers who are behind one of the projects, and infuriated others. Playing for time, Mr Modi reportedly asked to discuss this matter with his officials and developers of the project.
Plans for the $500 million coal power plant project were finalised in 2011, when state-run Ceylon Electricity Board (CEB) and India's state-run National Thermal Power Corporation (NTPC) agreed to form a joint venture for its construction. Following the U-turn of, it is not clear which Indian firms would be considered on the proposed gas-fired plant.
As for new LNG-fuelled power project, China Machinery Engineering Corp (CMEC) is evaluating a 500 MW LNG-fuelled power project in Hambantota, southern Sri Lanka, which is meant to be expanded to 1,000 MW. President Sirisena pushes for another 500 MW LNG-to-power plant just north of Colombo.